Tuesday, June 27, 2023

Republic Act No. 9700: Once a CLOA, always a CLOA title.

 A lot of people who desire to buy agricultural lands often ask: Can a Certificate of Land Ownership Award (CLOA), which is also a TCT title, be sold and converted into a regular TCT title? And the answer to that question is generally, a CLOA title CANNOT be converted into a regular TCT title.  

Section 27 of Republic Act No. 6657, as amended by Section 12 of Republic Act No. 9700, reads as follows: 

"SEC. 27. Transferability of Awarded Lands. - Lands acquired by beneficiaries under this Act or other agrarian reform laws shall not be sold, transferred or conveyed except through hereditary succession, or to the government, or to the LBP, or to other qualified beneficiaries through the DAR for a period of ten (10) years: Provided, however, That the children or the spouse of the transferor shall have a right to repurchase the land from the government or LBP within a period of two (2) years x x x."

"The title of the land awarded under the agrarian reform must indicate that it is an emancipation patent or a certificate of land ownership award and the subsequent transfer title must also indicate that it is an emancipation patent or a certificate of land ownership award.

"If the land has not yet been fully paid by the beneficiary, the rights to the land may be transferred or conveyed, with prior approval of the DAR, to any heir of the beneficiary or to any other beneficiary who, as a condition for such transfer or conveyance, shall cultivate the land himself/herself. Failing compliance herewith, the land shall be transferred to the LBP which shall give due notice of the availability of the land in the manner specified in the immediately preceding paragraph.

"In the event of such transfer to the LBP, the latter shall compensate the beneficiary in one lump sump for the amounts the latter has already paid, together with the value of improvements he/she has made on the land."

Source: Republic Act No. 9700

Tuesday, June 6, 2023

DAR Region 2 distributes Php17.6 million worth of farm machinery and equipment.

The Department of Agrarian Reform (DAR) provincial offices in the Cagayan Valley region (Region 2) have procured and distributed Php17.6 million worth of farm machinery and equipment (FME) consisting of tractors, combine harvesters, delivery trucks, etc., to nine (9) agrarian reform beneficiaries' organizations (ARBOs) in the different provinces in the region. The FME would help farmers modernize their operations and increase their yield resulting to increase in income.  

According to DAR region 2 Regional Director Primo C. Lara, the farm machineries and equipment for distribution to selected agrarian reform beneficiaries' organizations is being implemented under the Sustainable and Resilient Agrarian Reform Communities Project (SuRe ARCs), a DAR program for farm machines aimed to improve farm productivity and increase thehousehold income of ARBs through the ARBOs where they are a member.  


The turnover of the farm equipment was graced by the presence of Atty. Kazel Celeste, DAR Undersecretary for Field Operations (FOO) and Atty. Marjorie P. Ayson, DAR Assistant Secretary, FOO. The FME was distributed to the following ARBOs: Sunrise Multi-Purpose Cooperative, Garita Farmers Agriculture Cooperative, the Farmers of Luna Agriculture Cooperative, Villaverde Development Cooperative, Brgy. Paitan Farmers Irrigators Association, Inc., San Salvador ARB Association, Luttuad ARB Farmers Association, San Francisco ARB Farmers Association, Maui Farmers' Cooperative, Dicamay Farmers Agri Cooperative, Greenfield Cabatuan Agriculture Cooperative, Nam-Ay Farmers Association, Western Aurora Agri Cooperative, Upper Forest Region Agrarian Reform Cooperative, Reform Farm Workers Association, Sinili Vegetable Growers Cooperative, and Rotary Community Corps of Cauayan City Producers Cooperative. 


The SuRe ARCs is a program of the Department of Agrarian Reform that aims to support the agricultural sector and enhance food security. In addition to farm mechanization, the project is also establishing enterprise-based crop nurseries with greenhouse facilities and tissue culture laboratories in agrarian reform beneficiary organizations, state universities and colleges, and local government units within Agrarian Reform Communities (ARCs).  

Turnover of farm machinery and equipment under DAR Project SuRe ARCs.  


DAR Usec Atty Kazel C. Celeste (left) and DAR Asec Atty Marjorie P. Ayson. 

Delivery truck for hauling of ARB agri products. 

Combine harvesters and tractors. 

Four-wheeled tractors for ARB coops. 

DARPO Cagayan-Batanes PARPO II Val M. Cristobal and staff.

Sunrise MPC officers and members - recipients of delivery truck. 







Friday, March 24, 2023

Annulment of EP titles in the absence of full payment of the value of the lands covered by Pres. Decree No. 27


The requirements of the laws and jurisprudence on Presidential Decree No. 27 (Operation land Transfer) leads to annulment of the emancipation patents issued in the absence of any proof that the farmer-beneficiaries or the LBP has already fully paid the value of the lands put under the coverage of Pres. Decree No. 27. The requirement is unequivocal in that the value of the land awarded to farmer-beneficiaries must, prior to the issuance of emancipation patents, be paid in full. Payment of lease rentals shall terminate on the date the value of the land is established. Therafter, the tenant-farmers shall pay amortizations to the Land Bank (LBP). The rentals previously paid are to be credited as partial payment of the land transferred to tenant-farmers. (Coruna vs. Cinamin, G.R. NO. 154286. February 28, 2006)


FIRST DIVISION

[ G.R. NO. 154286. February 28, 2006 ]

MAGDALENA CORUÑA, JORGE CORUÑA, ESTATE OF ALBERTO CORUÑA, ROSITA CORUÑA, ESTATE OF BENJAMIN CORUÑA, JUANITA ELIZALDE, FLORA ACOSTA, LORETO CORUÑA, AND ESTATE OF JOSE CORUÑA, PETITIONERS,

                                                                                  VS.

SATURNINO CINAMIN,[1] ANDRES ACANA, ROSITA LAUREANO, ROGELIO ENGAG,[2] DOMINADOR GABIOTA, JR., FEDERICO GABIOTA, RAUL VANGUARDIA, ROMEO LOCSIN, GUALBERTO GUALDRAPA,[3] CARLITO GOROY, GERVACIO SONQUIAWON, LEOPOLDO BELO, AND NORMA LOCSIN, RESPONDENTS.

D E C I S I O N

CHICO-NAZARIO, J.:

This is a petition for review on certiorari assailing the Decision[4] of the Court of Appeals in CA-G.R. SP No. 59922 dated 14 December 2001, and its Resolution[5] dated 23 May 2002, which denied petitioners' motion for reconsideration thereby affirming the decision[6] of the Department of Agrarian Reform Adjudication Board (DARAB) in DARAB Case No. 4338 and DARAB Case No. 4339 promulgated on 07 June 2000. The DARAB decision, in turn, affirmed in toto the decision[7] of the Provincial Agrarian Reform Adjudication Board (PARAD) of Bacolod City which dismissed petitioners' complaints for lack of merit.

The factual antecedents follow:

Julieta Vasquez Coruña was the owner of Lot No. 1176-A located in Himaya, Hinigaran, Negros Occidental, with an area of 119.3830 hectares and Lot No. 350-B situated in Payao, Binalbagan, Negros Occidental, composed of 25.2513 hectares. When Julieta died intestate on 30 September 1972, these properties passed on to petitioners who were her children, namely: Magdalena, Jorge, Rosita, Loreto, Rosendo, Jose, Benjamin, all surnamed Coruña, Juanita Elizalde, and Flora Acosta. Rosendo died leaving behind as compulsory heirs Marivic Togle, Diana, Cesar, and Anna Coruña. When Jose passed away, he left, as his compulsory heirs Priscilla, Patricia, Ma. Fe, and Jose Ma., all surnamed Coruña, while Benjamin died without issues.

Lot No. 1176-A was tenanted by respondents Saturnino Cinamin, Andres Acana, Rosita Laureano, Rogelio Egang, Dominador Gabiota, and Federico Gabiota. On the other hand, Lot No. 350-B was tenanted by respondents Raul Vanguardia, Romeo Locsin, Gilberto Gualdrapa, Carlito Goroy, Gervacio Sonquiawon, Leopoldo Belo, and Norma Locsin.[8]

On 28 June 1994, petitioners filed before the (PARAD) two separate complaints for cancellation and/or nullification of emancipation patents and/or certificates of land transfers issued in favor of respondents.[9] The first complaint, docketed as PARAD Case No. VI-71-NO-94, was instituted against respondents Cinamin, Acana, Laureano, Engag, Gabiota, Jr., and Gabiota.[10]

In said complaint, petitioners alleged that Lot No. 1176-A was primarily devoted to sugar production and only a small portion thereof or about 9.92 hectares were devoted to rice and corn production. As the entire property was still under the regime of co-ownership, each petitioner was the pro-indiviso owner of only 9,920 square meters which was way below the seven-hectare retention limit mandated by Presidential Decree No. 27.[11] Despite this and the fact that neither respondents Cinamin, Acana, Laureano, Engag, Gabiota, Jr., and Gabiota nor their predecessors-in-interest were petitioners' tenants, emancipation patents were issued in favor of said respondents. Moreover, petitioners claimed that respondents failed to pay the rentals and amortizations for the lands awarded to them.

In their answer with motion to dismiss,[12] respondents Cinamin, Acana, Laureano, Engag, Gabiota, Jr., and Gabiota insisted that they were tenants of Lot No. 1176-A as they and their predecessors-in-interest were duly paying the landowners' shares on the lands they were farming such that when Pres. Decree No. 27 took effect, the Department of Agrarian Reform (DAR) immediately recognized them as farmer-beneficiaries. They likewise alleged that they were paying their amortizations for the lands granted to them through the Land Bank of the Philippines (LBP) and that aside from this, they had been paying the real property taxes due on the subject lands.

The second case was instituted by petitioners against respondents Vanguardia, Locsin, Gualdrapa, Goroy, Sonquiawon, Belo, and Locsin and this was docketed as PARAD Case No. VI-72-NO-94.[13] In this complaint, petitioners alleged that Lot No. 350-B was primarily devoted to sugar production and only 8.10 hectares thereof, more or less, were used for rice and corn production. Petitioners stated that as Lot 350-B was still owned in common, each petitioner's share in the 8.10 hectares which was supposed to be covered by Pres. Decree No. 27 would be less than the retention limit stated in said statute. Petitioners, therefore, assailed the issuance of emancipation patents to respondents Vanguardia, Locsin, Gualdrapa, Goroy, Sonquiawon, Belo, and Locsin for being violative of the retention limit imposed by Pres. Decree No. 27. The issuance of emancipation patents in this PARAD case was likewise questioned on the grounds that respondents Vanguardia, Locsin, Gualdrapa, Goroy, Sonquiawon, Belo, and Locsin or their predecessors-in-interest were not tenants of Lot 350-B and that they failed to pay for the value of the lands awarded to them prior to the issuance of emancipation patents.

Respondents Vanguardia, Locsin, Gualdrapa, Goroy, Sonquiawon, Belo, and Locsin countered in their answer with motion to dismiss[14] that like the respondents in the other case, they and their predecessors-in-interest, as tenants of Lot 350-B, paid to petitioners the latter's share in their tenancy relationship. They also alleged that when Pres. Decree No. 27 was implemented, they were recognized by no less than the DAR as farmer-beneficiaries. As regards their alleged failure to pay for the value of the portions of Lot 350-B awarded to them, respondents Vanguardia, Locsin, Gualdrapa, Goroy, Sonquiawon, Belo, and Locsin claimed that they had been paying their amortizations through the LBP and that they were the ones paying the real property taxes for the lands awarded to them.

In a decision dated 22 December 1994, the PARAD disposed of the complaints in the following manner:

    WHEREFORE, premises considered, decision is hereby rendered dismissing the complaints for utter lack of merit.

    For lack of evidence, the counterclaim is denied.[15] 

According to the PARAD, petitioners failed to support their claim that respondents were not tenants of the lands subject of this dispute while for their part, respondents were able to prove the existence of tenancy relationship between them and petitioners. According to the PARAD, respondents were identified by the DAR as farmer-beneficiaries of Pres. Decree No. 27 and Letter of Instruction No. 474 and as such, they became owners of the land they tilled when Pres. Decree No. 27 took effect on 21 October 1972.[16] Respondents' status as tenants of Lot Nos. 1176-A and 350-B was also corroborated by receipts evidencing their payments of rentals or landowner's share to petitioners which were signed by petitioner Jorge Coruña and the affidavits executed by respondents to the effect that they were tenants in petitioners' lands.[17] As for respondents' alleged failure to pay rentals, the PARAD ruled in this wise: 

    Payment of rentals to the landowner is no longer the concern of EP beneficiaries. From the moment the EP is issued, the obligation of the EP holder is concentrated with the Land Bank of the Philippines for purposes of amortizations of the value of the land. It is in fact prevalent on the date the value of the land is established (Memo Circular No. 6, Series of 1978, Curso v. Court of Appeals, G.R. No. L-62985, April 2, 1984). In the instant case, aside from being not the proper party, complainants [petitioners herein] presented no concrete evidence showing that respondents failed to do so. On the contrary, they presented LBP receipts to prove no cause of claim (Annexes "O-15," "R-15," "Y-19," "OO," "OO-1," and "OO-2") against the provisions of IV-B-7 of DAR Administrative Order No. 02, Series of 1994 which makes as a ground for cancellation of registered EP's or (CLOAÑs), the "failure of the ARB's to pay for at least three (3) annual amortizations to the LBP, except in cases of fortuitous events and force majeure."[18] 

Anent petitioners' contention that the inclusion of parts of Lot Nos. 1176-A and 350-B within the coverage of Pres. Decree No. 27 undermined their retention limit under said law, the PARAD held that as each complainant already owned around 12.7614 hectares of agricultural land aside from the area covered by Operation Land Transfer, they are no longer entitled to the seven-hectare retention area. The PARAD based this finding on the following provision of DAR Administrative Order No. 4, Series of 1991, which was quoted in its decision:

    "x x x An owner of tenanted rice and corn lands may not retain these lands under the following cases:

    x x x x

    b) By virtue of LOI 474, if he as of 21 October 1976 owned less than 24 hectares of tenanted rice or corn lands but additionally owned the following:

    - Other agricultural lands of more than seven hectares, whether tenanted or not, whether cultivated or not, and regardless of income derived therefrom; or x x x[19]

On 14 February 1995, petitioners filed a motion for reconsideration[20] but this was denied by the PARAD.

Petitioners thereafter filed a notice of appeal dated 29 June 1995[21] before the DARAB which, however, affirmed in toto the decision of the PARAD.[22]

Still undaunted, petitioners then sought relief before the Court of Appeals where their case once again failed to prosper for in its decision dated 14 December 2001, the Court of Appeals denied petitioners' petition for review. Petitioners' motion for reconsideration failed to persuade the Court of Appeals and so it was denied through the Court of Appeals' resolution dated 23 May 2002.

Hence, the present petition where petitioners pray that we reverse and set aside the assailed decision of the Court of Appeals and in lieu thereof a new judgment be rendered declaring as null and void the emancipation patents and/or certificates of land transfer issued by the DAR in favor of respondents.[23]

In their memorandum, the petitioners raise the following issues for our consideration:

    THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN NOT INVALIDATING THE EMANCIPATION PATENTS AND CERTIFICATES OF LAND TRANSFER AWARDED TO THE RESPONDENTS FOR HAVING BEEN ISSUED PRIOR TO THE FULL PAYMENT OF THE AMORTIZATION REQUIRED UNDER PRESIDENTIAL DECREE NO. 27.[24]

 THE COURT OF APPEALS ERRED IN RULING THAT THE PAYMENTS MADE BY THE RESPONDENTS TO THE LAND BANK OF THE PHILIPPINES ARE CREDITED AS VALID AMORTIZATION PAYMENTS AS REQUIRED UNDER PRESIDENTIAL DECREE NO. 27.[25]

Petitioners contend that under both law and jurisprudence, emancipation patents may only be issued to farmer-beneficiaries after they had fully complied with the requirements of Pres. Decree No. 27 including the full payment of amortization. In support of this contention, they cite the first paragraph of Section 2, Pres. Decree No. 266[26] which states:

    Sec. 2. After the tenant-farmer shall have fully complied with the requirements for a grant of title under Presidential Decree No. 27, an Emancipation Patent and/or Grant shall be issued by the Department of Agrarian Reform on the basis of a duly approved survey plan.

Petitioners likewise rely on our following pronouncement in the case of Pagtalunan v. Tamayo:[27]

    x x x However, a careful study of the provisions of Pres. Decree No. 27, and the certificate of land transfer issued to qualified farmers, will reveal that the transfer of ownership over these lands is subject to particular terms and conditions the compliance with which is necessary in order that the grantees can claim the right of absolute ownership over them. 

    x x x x

    And under Pres. Decree No. 266 which specifies the procedure for the registration of title to lands acquired under Pres. Decree No. 27, full compliance by the grantee with the above-mentioned undertakings is required for a grant of title under the Tenant Emancipation Decree and the subsequent issuance of an emancipation patent in favor of the farmer/grantee [Section 2, Pres. Decree No. 266]. x x x.[28]

In this case, petitioners assert that the emancipation patents were issued to respondents on various dates between 1989 and 1990 notwithstanding the fact that they were still paying their amortizations to the LBP beyond said period in clear violation of the provisions of Pres. Decree No. 27 and Pres. Decree No. 266.[29]

Also, petitioners insist that the payments made by respondents to the LBP were invalid considering that Pres. Decree No. 816 requires the direct payment of amortizations to the landowners. According to petitioners, LBP's authority for receiving payments for lands within the coverage of Pres. Decree No. 27 was DAR Memorandum Circular No. 6, Series of 1978. However, this memorandum circular had already been declared invalid by the Court of Appeals in the case of Gonzales v. Land Bank of the Philippines[30] as it contravenes Pres. Decree No. 816's requirement of direct payment to the landowners of the value of the lands subjected to Pres. Decree No. 27.[31]

For their part, respondents claim that they have complied with what is required of them under the law. For one, petitioners maintain that they have been paying to the LBP the monthly amortization due on the lands awarded to them and that in fact, some of them had paid the LBP the full amount of their obligations.[32] They also assert that even prior to this, they religiously paid the landowner's share in the portions of the land that they respectively tilled.[33] Respondents likewise point to the initiatory steps taken by the DAR in the implementation of Operation Land Transfer program of Pres. Decree No. 27 particularly the determination of the average gross production data per hectare conducted by the Barangay Committee on Land Production (BCLP).[34] As the BLCP had already done its duty of determining the value of the subject lands, respondents were then authorized to pay for the lands awarded to them to the LBP.[35]

Anent the issue of the validity of the payments to the LBP, respondents direct us to our holding in the case of Locsin v. Valenzuela[36] where we declared that "(u)nder PD No. 251, dated July 21, 1973, the Land Bank is tasked to finance the acquisition of farm lots and whenever it pays the whole or a portion of the total cost of the farm lots, it shall be subrogated to the right of the landowner to collect and receive the yearly amortizations or the amount paid including interest thereon, from the tenants-farmers in whose favor the farm lots had been transferred pursuant to PD No. 27."[37]

We find the petition partly meritorious.

As the opening paragraph of Pres. Decree No. 27 explains, said statute was issued in order to address the then prevailing violent conflict and social tension brought about by the iniquitous landownership by a few. It is within this context that former President Ferdinand Marcos deemed it proper to declare the emancipation of all tenant-farmers effective 21 October 1972. Nevertheless, such emancipation does not come free for the farmers who were supposed to benefit from said decree. Indeed, a reading of the full text of said statute reveals that the transfer of ownership over the lands covered under Pres. Decree No. 27 is still subject to particular terms and conditions which must be complied with by the grantee.[38] As this Court held in the case of Paris v. Alfeche[39] where one of the issues raised was the propriety of the issuance of emancipation patents notwithstanding lack of payment of just compensation –

    Petitioner, however, claims that she was not paid just compensation and, thus, prays for the cancellation of the Emancipation Patents issued to respondents under PD 27. She contends that "it is illegal for the DAR to take property without full payment of just compensation[;] until full payment is done the title and ownership remain with the landholder."

    Petitioner's contention has merit. Section 2 of PD 266 states:

        "After the tenant-farmer shall have fully complied with the requirements for a grant of title under Presidential Decree No. 27, an Emancipation Patent and/or Grant shall be issued by the Department of Agrarian Reform on the basis of a duly approved survey plan."

    On the other hand, paragraphs 8 and 9 of PD 27 reads as follows:

        "For the purpose of determining the cost of the land to be transferred to the tenant-farmer pursuant to this Decree, the value of the land shall be equivalent to two and one-half (2 ½) times the average harvest of three normal crop years immediately preceding the promulgation of this Decree;

        "The total cost of the land, including interest at the rate of six (6) per centum per annum, shall be paid by the tenant in fifteen (15) years of fifteen (15) equal annual amortizations[.]"

    Although, under the law, tenant farmers are already deemed owners of the land they till, they are still required to pay the cost of the land, including interest, within fifteen years before the title is transferred to them. Thus, the Court held in Association of Small Landowners in the Philippines v. Secretary of Agrarian Reform:[40]

   "It is true that PD 27 expressly ordered the emancipation of tenant-farmers as of October 21, 1972 and declared that he shall 'be deemed the owner' of a portion of land consisting of a family-sized farm except that 'no title to the land owned by him was to be actually issued to him unless and until he had become a full-fledged member of a duly recognized farmers' cooperative.' It was understood, however, that full payment of the just compensation also had to be made first, conformably to the constitutional requirement."

    x x x x

    Presidential Decree 27 and subsequently Executive Order (EO) 228, which recognized the rights acquired by tenant-farmers under PD 27, provide in detail the computation to be used in arriving at the exact total cost of the parcels of land. Evidently, therefore, the law recognizes that their exact value, or the just compensation to be given to the landowner, cannot just be assumed; it must be determined with certainty before the land titles are transferred.

    Although EO 228 provides that the total lease rentals paid for the lands from October 21, 1972 shall be considered as advance payment, it does not sanction the assumption that such rentals are automatically considered as equivalent to just compensation for the land. The provision significantly designates the lease rentals as advance, not full payment. The determination of the exact value of the lands cannot simply be brushed aside, as it is fundamental to the determination of whether full payment has been made.

In the case at bar, respondents submitted as evidence the accomplished forms of Land Valuation Summary & Farmer's Undertaking of the LBP[41] and the average gross production prepared by the BCLP's in Barangays Hinigaran and Payao, Binalbagan, Negros Occidental.[42] To our mind, however, these documentary evidence, pertaining merely to the valuation of the subject lands, do not meet the requirement of Pres. Decree No. 27 and Pres. Decree No. 266 with respect to the issuance of emancipation patents to respondents. Valuation of the land is only one aspect of the whole process of agrarian reform; full compensation for the value of land is another. As discussed above, the laws mandate the full compensation for the lands acquired under Pres. Decree No. 27 prior to the issuance of emancipation patents. This is understandable particularly since the emancipation patent presupposes that the grantee thereof has already complied with all the requirements prescribed by Pres. Decree No. 27.[43] The issuance of emancipation patent, therefore, conclusively vests upon the farmer/grantee the rights of absolute ownership over the land awarded to him.[44]

While this Court commiserates with respondents in their plight, we are constrained by the explicit requirements of the laws and jurisprudence on the matter to annul the emancipation patents issued to respondents in the absence of any proof that they or the LBP has already fully paid the value of the lands put under the coverage of Pres. Decree No. 27. The requirement is unequivocal in that the values of the lands awarded to respondents must, prior to the issuance of emancipation patents, be paid in full.

Under the rules of evidence, respondents, as debtors, bear the onus of showing with legal certainty that the obligation to petitioners with respect to the value of the lands awarded to them has been discharged by payment.[45] Sadly for respondents, they failed to dispose of this burden as the records of this case is bereft of any evidence, such as certifications from the proper government authorities, which would satisfactorily establish that the requisite full payment to petitioners has been complied with. The cancellation of the emancipation patents subject of this case, perforce, follows. Dura lex sed lex.

Despite the cancellation of emancipation patents in this case, respondents, however, should remain in possession of the disputed lands. Section 22 of Republic Act No. 6657,[46] which we have ruled to apply to lands rice and corn lands under Pres. Decree No. 27,[47] clearly provides that "actual tenant-tillers in the landholding shall not be ejected or removed therefrom."[48] Thus, while actual titles remain with petitioners, respondents are entitled to maintain possession of the lands granted to them.

We cannot, however, agree in the petitioners' contention that the amortization payments made by respondents to the LBP were invalid. Petitioners' reliance in the holding of the Court of Appeals in Gonzales v. Land Bank of the Philippines[49] is unavailing. As this Court held in Curso v. Court of Appeals,[50] there is neither inconsistency nor incompatibility between Pres. Decree No. 816 and DAR's Memorandum Circular No. 6, Series of 1978, thus:

    2. The CAR was of the opinion that as between P.D. 816 and the MAR Circular, it is the former that should prevail. Actually, we find no inconsistency nor incompatibility between them. Of significance are the two "whereas" clauses of P.D. 816 quoted hereunder:

    "WHEREAS, in the meanwhile that the implementing rules and regulations of Presidential Decree No. 27 have not yet been issued completely, the status quo shall be maintained between the parties, that is, the landowner shall continue to pay the land taxes thereon if the said landholdings is not yet covered by Certificate of Land Transfer, while on the other hand the tenant-farmer who is now called agricultural lessee shall continue to pay the rental to the landowner whether or not his landholding planted to rice and corn is already covered by Certificate of Land Transfer;

    "WHEREAS, such payment of rental shall continue until and after the valuation of the property shall have been determined or agreed upon between the landowner and the Department of Agrarian Reform which, in turn, will become the basis for computing the amortization payment to be made by the agricultural lessee in 15 years with 6% interest per annum under Presidential Decree No. 27." (Italics supplied)

    Clearly, under P.D. No. 816, rentals are to be paid to the landowner by the agricultural lessee until and after the valuation of the property shall have been determined.

    In the same vein, the MAR Circular provides:

       "Payment of lease rentals to landowners covered by OLT shall terminate on the date the value of the land is established. Thereafter, the tenant-farmers shall pay their lease rentals/amortizations to the LBP or its authorized agents x x x"

        and

        "The value of the land is established on the date the Secretary (now Minister) or his authorized representative has finally approved the average gross production data established by the Barangay Committee on Land Production (BCLP) or upon the signing of the LTPA by landowners and tenant-farmers concerned heretofore authorized."

    In other words, the MAR Circular merely provides guidelines in the payment of lease rentals/amortizations in implementation of P.D. 816. Under both P.D. 816 and the MAR Circular, payment of lease rentals shall terminate on the date the value of the land is established. Therafter, the tenant-farmers shall pay amortizations to the Land Bank (LBP). The rentals previously paid are to be credited as partial payment of the land transferred to tenant-farmers.

This was our similar holding in the case of Sigre v. Court of Appeals[51] where we declared that there is no "irreconcilable conflict" between P.D. No. 816 and the DAR Memorandum Circular No. 6.

In the present case, the value of the land located in Barangay Himaya was determined on 17 June 1988 by the BCLP[52] while that of the land situated in Barangay Payao was ascertained on 20 December 1977.[53] Notably, these values were subsequently adopted by the LBP.[54] As the valuation of the subject lands was already accomplished, respondents were then authorized to course their payment through the LBP pursuant to Pres. Decree No. 816 and DAR Memorandum Circular No. 6.

WHEREFORE, premises considered, the present petition is PARTIALLY GRANTED and the Decision dated 14 December 2001 is hereby MODIFIED by declaring that the emancipation patents issued to respondents are null and void. No costs.

SO ORDERED. 

Panganiban, C.J., (Chairperson), Ynares-Santiago, Austria-Martinez and Callejo, Sr., JJ., concur.


[1] Spelled as Senanin in the Answer with Motion to Dismiss; Records, p. 9.

[2] Spelled as Egang in the Answer with Motion to Dismiss; Id., p. 9.

[3] Spelled as Gilberto Gualdrapa in his Affidavit; Id., p. 119.

[4] Penned by Associate Justice Marina L. Buzon with Associate Justices Buenaventura J. Guerrero and Alicia L. Santos, concurring; Rollo, pp. 21-28.

[5] Rollo, pp. 29-30.

[6] Id., pp. 37-48.

[7] Id., pp. 31-36.

[8] Records, p. 43.

[9] Per the decision of the DARAB, the emancipation patents were issued to respondents in the following manner:

    Lot 1176-A

        Gorgonia Acana, predecessor-in-interest of Respondent-appellee Andres Acana, EP No. 5065 covering an area of seven hundred seventy-six (776) square meters was issued on November 29, 1989;

        Saturnino Cinamin, EP No. 5344 was issued on April 26, 1990 covering an area of 509 square meters;

        Dominador Gabrieta, predecessor-in-interest of Rogelio Egang, Dominador Gabiota, Jr., and Federico Gabiota, covering an area of two point sixty-three (2.63) [hectares];

        Gorgonia Acana, predecessor-in-interest of Andres Acana was awarded an area covering point four ninety-four (.94) (sic) hectare[;] and

        Basilio Cinamin, predecessor-in-interest of Saturnino Cinamin was granted a portion of land covering an area of two point six (2.6) [hectares] and Rosita Laureano.

    Lot 350-B

    Aurora Goroy, predecessor-in-interest of respondent Goroy, 2.5552 hectares;

    Raul Vanguardia;

    Roberto Gualdrapa, 9.7700 hectares;

    Carlito Goroy, 6301 (sic) hectares;

    Cornelio Locsin, predecessor-in-interest of Norma Locsin, 1.3626 hectares;

    Leopoldo Belo, .11634 (hectare). (Rollo, pp. 39-40).

[10] Records, pp. 1-5.

[11] Decreeing the Emancipation of Tenant from the Bondage of the Soil, Transferring to Them the Ownership of the Land They Till and Providing the Instruments and Mechanism Therefor; issued on 21 October 1972.

[12] Records, pp. 7-10.

[13] Id., pp. 1-5.

[14] Id., pp. 9-11.

[15] Rollo, p. 36.

[16] Citing Locsin v. Valenzuela, G.R. Nos. 51333 & 52289, 19 February 1991, 194 SCRA 194, 203.

[17] Records, p. 151-A.

[18] Rollo, pp. 35-36.

[19] Id., p. 36.

[20] Records, pp. 154-165.

[21] Id., pp. 187-188.

[22] Decision dated 07 June 2000; Id., pp. 224-235.

[23] Rollo, p. 244.

[24] Id., p. 239.

[25] Id., p. 242.

[26] Providing for the Mechanics of Registration of Ownership and/or Title to Land Under Presidential Decree No. 27.

[27] G.R. No. 54281, 19 March 1990, 183 SCRA 252, 258-259.

[28] Id. at 258-259.

[29] Rollo, pp. 240-241.

[30] CA-G.R. SP No. 28906, 22 March 1993; Id., pp. 83-96.

[31] Rollo, pp. 242-243.

[32] Id., p. 150.

[33] Id., p. 121.

[34] Id., p. 197.

[35] Id., p. 124, citing Curso v. Court of Appeals, 213 Phil. 506, 515 (1984).

[36] Supra note 16, p. 203.

[37] Rollo, p. 198.

[38] Id., p. 258.

[39] 416 Phil. 473, 486-488 (2001).

[40] G.R. Nos. 78742, 79310, 79744, and 79777, 14 July 1989, 175 SCRA 343, 390.

[41] Comment to the Appeal Memorandum, Annexes "A," "B," "C," "D," and "E"; Records, pp. 203-207.

[42] Comment to the Appeal Memorandum, Annexes "F" and "G"; Id., pp. 201-202.

[43] Martillano v. Court of Appeals, G.R. No. 148277, 29 June 2004, 433 SCRA 195, 204.

[44] Id.

[45] Jimenez v. National Labor Relations Commission, et al., 326 Phil. 89, 95 (1996).

[46] The Comprehensive Agrarian Reform Law of 1988.

[47] Land Bank of the Philippines v. Court of Appeals, 378 Phil. 1248, 1260 (1999).

[48] Cited in Paris v. Alfeche, supra note 39, p. 489.

[49] Supra note 30.

[50] Supra note 35, pp. 513-514.

[51] 435 Phil. 711, 720-721 (2002).

[52] Records, p. 201.

[53] Id., p. 202.

[54] Id., pp. 203-207.

Thursday, March 16, 2023

Unpaid Emancipation Patents (EPs) may be cancelled

The Philippine Supreme Court said that an Emancipation Patent (EP) title may be cancelled for violations of agrarian laws, rules and regulations (Mago vs. BarbinG.R. No. 173923, October 12, 2009). 


THIRD DIVISION

 [G.R. No. 173923.  October 12, 2009.]

 PEDRO MAGO (deceased), represented by his spouse SOLEDAD MAGO, AUGUSTO MAGO (deceased), represented by his spouse NATIVIDAD MAGO, and ERNESTO MAGO, represented by LEVI MAGO, petitionersvs. JUANA Z. BARBIN, respondent.

 DECISION

CARPIO, J p:

The Case

        This is a petition for review of the Decision dated 20 October 2005 and the Resolution dated 13 July 2006 of the Court of Appeals in CA-G.R. SP No. 87370. 

 The Facts

        On 11 November 1994, respondent Juana Z. Barbin filed with the Provincial Agrarian Reform Adjudicator (PARAD) of Camarines Norte an action for Cancellation of Emancipation Patents, Disqualification of Tenant-Beneficiary, Repossession and Damages. Respondent alleged that she is the owner in fee simple of an irrigated riceland located in Barangay Guinacutan, Vinzons, Camarines Norte, with an area of 4.7823 hectares, and that Augusto Mago, Crispin Mago, Ernesto Mago, and Pedro Mago were tenants of the subject landholding. Respondent further alleged that petitioners violated the terms of their leasehold contracts when they failed to pay lease rentals for more than two years, which is a ground for their dispossession of the landholding.

        On the other hand, petitioners alleged that the subject landholding was placed under the Operation Land Transfer program of the government pursuant to Presidential Decree No. 27 (PD 27). Respondent's title, OCT No. P-4672, was then cancelled and the subject landholding was transferred to Augusto Mago, Crispin Mago, Ernesto Mago, and Pedro Mago, who were issued Emancipation Patents on 20 February 1987 by the Department of Agrarian Reform (DAR). The Transfer Certificates of Title issued to petitioners emanating from the Emancipation Patents were registered with the Registry of Deeds on 9 February 1989. Petitioners averred that prior to the issuance of the Emancipation Patents, they already delivered their lease rentals to respondent. They further alleged that after the issuance of the Emancipation patents, the subject landholding ceased to be covered by any leasehold contract.

        In a Decision dated 30 January 1997, the PARAD denied the petition for lack of merit. The PARAD found that in her petition for retention and exemption from the coverage of the Operation Land Transfer, and cancellation of Certificates of Land Transfer, filed before the DAR, respondent admitted that aside from the 6.7434 hectares of riceland, she also owns other agricultural lands with an aggregate of 16.8826 hectares consisting of "cocolands". The PARAD held that the subject landholding is clearly covered by the Operation Land Transfer under Letter of Instruction No. 474 (LOI 474). 10 Under LOI 474, then President Ferdinand E. Marcos directed the Secretary of Agrarian Reform to place under the Land Transfer Program of the government pursuant to PD 27 all tenanted rice/corn lands with areas of seven hectares or less belonging to landowners who own other agricultural lands of more than seven hectares in aggregate areas or lands used for residential, commercial, industrial or other urban purposes from which they derive adequate income to support themselves and their families.    HDATCc

       The PARAD further held that pursuant to DAR Memorandum Circular No. 6, series of 1978, payment of lease rentals to landowners covered by the Operation Land Transfer shall terminate on the date the value of the land is established. Thus, the PARAD held that the proper recourse of respondent is to file a claim for just compensation.

        On appeal, the Department of Agrarian Reform Adjudication Board (DARAB) reversed and set aside the PARAD Decision. The dispositive portion of the DARAB Decision dated 18 June 2004 reads:

WHEREFORE, premises considered, the Decision dated 30 January 1997 is hereby REVERSED and SET ASIDE and a new judgment is hereby entered:

1.      ORDERING the Register of Deeds of Camarines Norte to cancel EP Nos. 745, 747, and 749 issued in the name of Augusto Mago, Ernesto Mago, and Pedro Mago respectively, and

2.      DIRECTING the Municipal Agrarian Reform Officer of Vinzons, Camarines Norte, to reallocate the subject lands to qualified beneficiaries.

SO ORDERED. 11

        The DARAB held that when the subject landholding was placed under the Operation Land Transfer, the tenancy relationship between the parties ceased and the tenant-beneficiaries were no longer required to pay lease rentals to the landowner. However, when petitioners entered into an agreement with respondent for a direct payment scheme embodied in the Deeds of Transfer, petitioners obligated themselves to pay their amortizations to respondent who is the landowner. The DARAB found that except for Crispin Mago, who had fully paid his tillage, petitioners defaulted in their obligation to pay their amortization for more than three consecutive years from the execution of the Deeds of Transfer in July 1991. Under DAR Administrative Order No. 2, series of 1994, one of the grounds for cancellation of registered Emancipation Patents is when there is default in the obligation to pay an aggregate of three consecutive amortizations in case of direct payment schemes. Thus, the DARAB ruled that the cancellation of the Emancipation Patents issued to petitioners is warranted in this case.

        Petitioners filed a motion for reconsideration, which the DARAB denied for lack of merit. Petitioners then appealed to the Court of Appeals, which affirmed the DARAB Decision and thereafter denied petitioners' motion for reconsideration. Hence, this petition.

 The Court of Appeals' Ruling

        The Court of Appeals held that the mere issuance of an Emancipation Patent to a qualified farmer-beneficiary is not absolute and can be attacked anytime upon showing of any irregularity in its issuance or non-compliance with the conditions attached to it. The Emancipation Patent is subject to the condition that amortization payments be remitted promptly to the landowner and that failure to comply with this condition is a ground for cancellation under DAR Administrative Order No. 02, series of 1994. The Court of Appeals found that petitioners failed to comply with this condition since petitioners failed to prove that they have remitted the amortizations due to the landowner in accordance with their agreed direct payment scheme embodied in the Deeds of Transfer.    cHaADC

The Issues

        Petitioners contend that:

1. THE HONORABLE COURT OF APPEALS ERRED IN FINDING THE PETITIONERS LIABLE FOR VIOLATING DAR ADMINISTRATIVE ORDER NO. 02, SERIES OF 1994;

2.  THE HONORABLE COURT OF APPEALS ERRED IN AFFIRMING THE DECISION OF THE HONORABLE DAR ADJUDICATOR IN ORDERING THE CANCELLATION OF THE EMANCIPATION TITLES ISSUED TO THE PETITIONERS-FARMER BENEFICIARIES DESPITE THE LAPSE OF ONE (1) YEAR WHICH RENDERS THE SAID TITLES INDEFEASIBLE PURSUANT TO THE LAW AND JURISPRUDENCE;

3.  THE HONORABLE COURT OF APPEALS ERRED IN NOT CONSIDERING THE RECEIPTS EVIDENCING PAYMENTS OF THE DISPUTED AMORTIZATION WHICH WERE FORMALLY OFFERED AND CONSIDERED BY THE HONORABLE DAR PROVINCIAL ADJUDICATOR OF CAMARINES NORTE (PARAD) IN DECIDING THE CASE AS SHOWN IN THE DECISION DATED JANUARY 30, 199712

The Ruling of the Court

        We find the petition without merit.

        Petitioners argue that the Emancipation Patents and Transfer Certificates of Title issued to them which were already registered with the Register of Deeds have already become indefeasible and can no longer be cancelled.

        We do not adhere to petitioners' view. This Court has already ruled that the mere issuance of an emancipation patent does not put the ownership of the agrarian reform beneficiary beyond attack and scrutiny. 13 Emancipation patents issued to agrarian reform beneficiaries may be corrected and cancelled for violations of agrarian laws, rules and regulations. In fact, DAR Administrative Order No. 02, series of 1994, which was issued in March 1994, enumerates the grounds for cancellation of registered Emancipation Patents or Certificates of Landownership Award:

Grounds for the cancellation of registered EPs [Emancipation Patents] or CLOAs [Certificates of Landownership Award] may include but not be limited to the following:

1.      Misuse or diversion of financial and support services extended to the ARB [Agrarian Reform Beneficiaries]; (Section 37 of R.A. No. 6657)    HDIATS

2.      Misuse of the land; (Section 22 of R.A. No. 6657)

3.      Material misrepresentation of the ARB's basic qualifications as provided under Section 22 of R.A. No. 6657, P.D. No. 27, and other agrarian laws;

4.      Illegal conversion by the ARB; (Cf. Section 73, Paragraphs C and E of R.A. No. 6657)

5.      Sale, transfer, lease or other forms of conveyance by a beneficiary of the right to use or any other usufructuary right over the land acquired by virtue of being a beneficiary, in order to circumvent the provisions of Section 73 of R.A. No. 6657, P.D. No. 27, and other agrarian laws. However, if the land has been acquired under P.D. No. 27/E.O. No. 228, ownership may be transferred after full payment of amortization by the beneficiary; (Sec. 6 of E.O. No. 228)

 6.      Default in the obligation to pay an aggregate of three (3) consecutive amortizations in case of voluntary land transfer/direct payment scheme, except in cases of fortuitous events and force majeure;

7.      Failure of the ARBs to pay for at least three (3) annual amortizations to the LBP, except in cases of fortuitous events and force majeure; (Section 26 of RA 6657) 

8.      Neglect or abandonment of the awarded land continuously for a period of two (2) calendar years as determined by the Secretary or his authorized representative; (Section 22 of RA 6657)

9.      The land is found to be exempt/excluded from P.D. No. 27/E.O. No. 228 or CARP coverage or to be part of the landowner's retained area as determined by the Secretary or his authorized representative; and

10.    Other grounds that will circumvent laws related to the implementation of agrarian reform program. (Emphasis supplied)

        Under Section 3 of Executive Order No. 228 (EO 228), 14 one of the modes of paying compensation to the landowner is by direct payment in cash or kind by the farmer-beneficiaries. In this case, petitioners entered into an agreement with respondent for a direct payment scheme embodied in the Deeds of Transfer. However, petitioners failed to pay the amortizations to respondent landowner in accordance with their agreed direct payment scheme. As found by the Court of Appeals:    cDTACE

There is no substantial evidence on record that the petitioners had remitted the amortizations due to the landowner in accordance with their agreed direct payment scheme embodied in their deeds of transfer. In view thereof, We have no recourse but to sustain the findings of fact of the agency below. . . .

Indeed, We have scrutinized the evidentiary records but found no valid reason to depart from the challenged decision. Petitioner Pedro Mago's supposed receipts of payment to prove that he paid the amortizations due were not even attached to the records of this case. In the case of Augusto Mago, his payment of P3,500.00 does not clearly show that the payment was intended for the subject land. Granting that it was so, it appeared to be for initial payment only. In Ernesto Mago's case, his heirs relied on a MARO Certification stating that Juana Barbin had refused to accept their payment. It was, however, issued only on October 1, 2003 long after the filing of the complaint. While P.D. 27 aims to emancipate landless farmers, it does not also allow unjust treatment of landowners by depriving the latter of the just compensation due. 15

        Petitioners contend that the Court of Appeals erred in finding them liable for violating DAR Administrative Order No. 02, series of 1994. Well-settled is the rule that only questions of law can be raised in a petition for review under Rule 45 of the Rules of Civil Procedure. 16 The factual findings of the Court of Appeals are conclusive and cannot be reviewed on appeal, provided they are based on substantial evidence. 17 More so in this case where the findings of the Court of Appeals coincide with those of the DARAB, an administrative body with expertise on matters within its specific and specialized jurisdiction. 18

        In the first place, the Emancipation Patents and the Transfer Certificates of Title should not have been issued to petitioners without full payment of the just compensation. 19 Under Section 2 of Presidential Decree No. 266, 20 the

        DAR will issue the Emancipation Patents only after the tenant-farmers have fully complied with the requirements for a grant of title under PD 27. Although PD 27 states that the tenant-farmers are already deemed owners of the land they till, it is understood that full payment of the just compensation has to be made first before title is transferred to them. 21 Thus, Section 6 of EO 228 provides that ownership of lands acquired under PD 27 may be transferred only after the agrarian reform beneficiary has fully paid the amortizations. In Coruña v. Cinamin, 22 the Court held:

As discussed above, the laws mandate the full compensation for the lands acquired under Pres. Decree No. 27 prior to the issuance of emancipation patents. This is understandable particularly since the emancipation patent presupposes that the grantee thereof has already complied with all the requirements prescribed by Pres. Decree No. 27. . . . 

While this Court commiserates with respondents in their plight, we are constrained by the explicit requirements of the laws and jurisprudence on the matter to annul the emancipation patents issued to respondents in the absence of any proof that they or the LBP has already fully paid the value of the lands put under the coverage of Pres. Decree No. 27. The requirement is unequivocal in that the values of the lands awarded to respondents must, prior to the issuance of emancipation patents be paid in full. 23 (Emphasis supplied)

        In this case, both the Court of Appeals and the DARAB found that petitioners have not fully paid the amortizations for the land granted to them. The PARAD had a similar finding when it recommended that the proper recourse of respondent is to file a claim for just compensation. Clearly, the cancellation of the Emancipation Patents issued to petitioners is proper under the circumstances.

        WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 20 October 2005 and the Resolution dated 13 July 2006 of the Court of Appeals in CA-G.R. SP No. 87370.    IHCSTE

        SO ORDERED.

        Chico-Nazario, Velasco, Jr., Nachura and Peralta, JJ., concur.

Footnotes

  1.       Under Rule 45 of the 1997 Rules of Civil Procedure.

  2.       Penned by Associate Justice Jose Catral Mendoza with Associate Justices Jose L. Sabio, Jr. and Arturo G. Tayag, concurring.

  3.       DECREEING THE EMANCIPATION OF TENANTS FROM THE BONDAGE OF THE SOIL, TRANSFERRING TO THEM THE OWNERSHIP OF THE LAND THEY TILL AND PROVIDING THE INSTRUMENTS AND MECHANISM THEREFOR.

  4.       Emancipation Patent No. 745.

  5.       Emancipation Patent No. 746.

  6.       Emancipation Patent No. 747.

  7.       Emancipation Patent No. 749.

  8.       CA rollo, pp. 34-43. TCT No. EP-745 was issued to Augusto Mago covering a portion of the landholding containing an area of 8,278 square meters. TCT No. EP-747 was issued to Ernesto Mago covering a portion of the landholding containing an area of 15,310 square meters. TCT No. EP-749 was issued to Pedro Mago covering a portion of the landholding containing an area of 18,221 square meters. Crispin Mago was not included as petitioner in the petition for review filed with the Court of Appeals.

  9.       Rollo, pp. 43-49.

10.       LOI 474 was issued on 21 October 1976 by then President Ferdinand E. Marcos.

11.       Rollo, p. 60.

12.       Id. at 16.

13.       Mercado v. Mercado, G.R. No. 178672, 19 March 2009; Gabriel v. Jamias, G.R. No. 156482, 17 September 2008, 565 SCRA 443.

14.       EO 228, issued on 17 July 1987, provides for the manner of payment by the farmer beneficiary covered by PD 27 and the mode of compensation to the landowner. Section 3 of EO 228 reads:

           SECTION 3. Compensation shall be paid to the landowners in any of the following modes, at the point of the landowner:

                     (a) Bond payment over ten (10) years, with ten percent (10%) of the value of the land payable immediately in cash, and the balance in the form of LBP bonds bearing market rates of interest that are aligned with 90-day treasury bill rates, net of applicable final withholding tax. One tenth of the face value of the bonds shall mature every year from the date of issuances until the tenth year.

                     The LBP bonds issued hereunder shall be eligible for the purchase of government assets to the privatized.

                     (b) Direct payment in cash or kind by the farmer-beneficiaries with the terms to be mutually agreed upon by the beneficiaries and landowners and subject to the approval of the Department of Agrarian Reform; and

                     (c) Other modes of payment as may be prescribed or approved by the Presidential Agrarian Reform Council. (Emphasis supplied)

15.       Rollo, pp. 36-37.

16.       Section 1, Rule 45 states that the petition shall raise only questions of law which must be distinctly set forth. Ortega v. People, G.R. No 177944, 24 December 2008, 575 SCRA 519.

17.       Milestone Realty & Co. v. Court of Appeals, 431 Phil. 119 (2002).

18.       Avo-Alburo v. Matobato, 496 Phil. 293 (2005); Toralba v. Mercado, 478 Phil. 563 (2004); Padunan v. DARAB, 444 Phil. 213 (2003).

19.       Del Castillo v. Orciga, G.R. No. 153850, 31 August 2006, 500 SCRA 498.

20.       PROVIDING FOR THE MECHANICS OF REGISTRATION OF OWNERSHIP AND/OR TITLE TO LAND UNDER PRESIDENTIAL DECREE NO. 27. Issued on 4 August 1973.

21.       Paris v. Alfeche, 416 Phil. 473 (2001), citing Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian Reform, G.R. Nos. 78742, 79310, 79744, and 79777, 14 July 1989, 175 SCRA 343.

22.       G.R. No. 154286, 28 February 2006, 483 SCRA 507.

23.       Id. at 521-522.

Republic Act No. 9700: Once a CLOA, always a CLOA title.

  A lot of people who desire to buy agricultural lands often ask: Can a Certificate of Land Ownership Award (CLOA), which is also a TCT titl...